"I think one of the key concerns is not just that Germany is entering a new downturn but what that means for the rest of the euro zone. Because the health of Germany has been acting as some kind of prop for the rest of the region."

And Europe looks set to remain the major drag on the world economy next year.

"I can see this lasting well into the first half of next year, whether we find some lift in the second half, fingers crossed really. Hopefully we'll have some more certainty with the direction of Greece and the region's debt crisis which will help lift the mood amongst business and consumers and drive a bit more growth."

There was better news for the global economy though, as Chinese factories returned to growth.

Its vast manufacturing sector expanded for the first time in over a year.

And the U.S. index showed factory output growing at its fastest pace in five months.